Brazilian Billionaire Andre Esteves Arrested in Graft Probe

Andre Esteves, the Brazilian billionaire who transformed Grupo BTG Pactual into the largest independent investment bank in Latin America, was arrested as part of the corruption probe that has engulfed the state-run oil giant and some of the nation’s biggest builders.

Federal police arrested the banker in Rio de Janeiro after first searching for him in Sao Paulo, a police press official said by telephone Wednesday. Folha de S. Paulo reported the arrest on its website earlier.

It’s among the highest profile arrests to date since the investigation into a pay-to-play scheme between an alleged cartel of builders and oil producer Petroleo Brasileiro SA began in March 2014. More than 100 people have already been arrested, including former top executives at Petrobras and Brazil’s biggest construction conglomerate. The probe that has helped push Brazil into recession and left President Dilma Rousseff fighting for her political survival.

The government’s leader in the Senate, Delcidio Amaral, was also arrested, the police press official said, declining to provide details on the specific allegations against Esteves or Amaral. BTG’s press office said it couldn’t immediately comment, while calls and messages to Amaral’s press officer and chief of staff went unanswered.

Esteves in 2006 sold what was then Banco Pactual to UBS Group AG for $2.6 billion. He moved to London to be global head of fixed-income sales and trading for UBS the following year and offered to buy a controlling stake in the Swiss bank during the 2008 financial crisis. UBS rejected the bid and Esteves quit to form BTG, which he has joked stands for Back to the Game or Better than Goldman. In 2009, UBS agreed to sell to him and some of his former partners Pactual for $2.5 billion.

Andre Esteves, the Brazilian billionaire who transformed Grupo BTG Pactual into the largest independent investment bank in Latin America, was arrested as part of the corruption probe that has engulfed the state-run oil giant and some of the nation's biggest builders.